Would it be fair to dismiss an employee for failing to disclose their bankruptcy when there is no written requirement in their employment contract or a policy requiring them to do so?
This question was considered by the Employment Appeal Tribunal (EAT) in Pubbi v Your-Move.co.uk.
Ketan Pubbi worked for Your-Move.co.uk (Your Move), an estate agency, as a financial consultant from 2015. Following a period of unpaid sick leave, Mr Pubbi entered into bankruptcy on 29 January 2018. Your Move then became aware that Mr Pubbi had been declared bankrupt on 8 February 2018, when a member of HR carried out a Google search.
Your Move was a representative for First Complete Ltd, which sets the terms under which Your Move advisors are permitted to carry out work. First Complete terminated Mr Pubbi’s authorisation to hold himself out as an adviser on behalf of First Complete on 13 February 2018. First Complete had determined that Mr Pubbi entering into bankruptcy, combined with his failure to disclose his this to Your Move, meant that he was not a “fit and proper person” in accordance with the Financial Conduct Authority Handbook.
Your Move conducted an investigation, and Mr Pubbi was invited to a disciplinary hearing concerning his failure to notify the company that he had been declared bankrupt, the loss of his authorisation with First Complete, and the first two charges resulting in a fundamental breakdown of trust and confidence between Mr Pubbi and Your Move. Mr Pubbi was dismissed for gross misconduct.
Mr Pubbi brought Employment Tribunal claims, including a claim for unfair dismissal on the basis that he was under no obligation to disclose his bankruptcy.
Whilst the Employment Tribunal noted that the decision to dismiss Mr Pubbi had been “harsh”, it found that he had been fairly dismissed. Mr Pubbi held a responsible position at Your Move, and Your Move applied strict rules to its financial advisers.
Mr Pubbi appealed to the EAT. Had the Tribunal been correct to find that Mr Pubbi’s dismissal was fair?
The EAT found no error of law in the Employment Tribunal’s decision that:
- Mr Pubbi was dismissed by Your Move for consciously deciding not to disclose his bankruptcy;
- Your Move considered this to be a serious matter, notwithstanding the fact that Your Move had no express contractual term or procedure requiring Mr Pubbi to disclose his bankruptcy;
- Your Move considered that Mr Pubbi should have, in all the circumstances, appreciated that Your Move would regard his bankruptcy as an important issue that needed to be disclosed;
- Your Move reached this conclusion after a fair overall process which granted Mr Pubbi a fair opportunity to make points in his defence; and
- Your Move was in all the circumstances entitled to view Mr Pubbi’s conduct as sufficiently serious to warrant his dismissal.
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